Marketing Communication - Beer Company - Case Study Example

Running Header: Proposed IMC Plan Proposed IMC Plan for XXXX Beer Company Name Course Module University and College. 1. Introduction Importance of integrated marketing communications to business organisations is very significant. Integrating the various marketing communication strategies is the key to successful brand building and product management. The brands depend on such cohesive marketing messages to own a position in the consumer’s mind. In order to achieve this status of “ownership” the marketing communications and the overall marketing strategy itself should be totally integrated to achieve the synergy. When the marketing communications and marketing mix is fragmented and executed in isolation and in ad hoc manner, there is little effectiveness and no synergy towards long term brand building and strengthening. This report proposes an Integrates Marketing Communication Plan for XXX beer for the Australian market. Although Lion Nathan Company has many other brands of beer, the focus of this report is on the XXXX brand. 1. Situation Analysis In order to develop effective strategies, organisations need to have a proper awareness of the market conditions and the competitors. Following is a brief situational analysis is conducted in relation to XXXX Beers which is the leading brand within the Lion Nathan’s brand portfolio. 2.1 Market Analysis The Australian beer market remains relatively flat in its growth rate with an annual market size of approximately $8 billion. Although the full strength beers still dominate the market, the consumer preferences are changing over the decade and there is a growing preference for low and mid strength beers as well as specialty bears instead of full strength beers. The premium beer market too is gaining grounds at the expense of full strength market. According to David Lipman, who is the publisher of Beer and Brewer magazine, “the number of craft brewers in Australia has tripled over the past 10 years, with 140 now in operation, excluding so-called "brewpubs" which produce beer for on-premises consumption” (Blair, 2010). 2.2 Competitor Analysis Foster's Brewing Group Ltd, and Lion Nathan Ltd, dominate the Australian brewing industry with a combined market share of some 90 percent In a report titled "Australian Brewing Industry in a Conundrum: Strong cash flow, but where to spend it?" Gary Lau commented on the two main rivals that they do not compete on price; rather they compete in marketing, brand building and distribution in order to protect their market share. (Asia Times Online-2003) In general, the popularity of various brands of beer differs by state. All brands offer a portfolio of beer products to cater to the numerous consumer need categories and have key products holding dominant positions in each product category. Other players in the market include Coppers Brewery Ltd and Viterra Ltd (Beer and Malt Manufacturing in Australia, 2010). 2.3 Organizational Back ground and Brand Analysis Castlemein Pekins is the initial producer of XXXX brand beer, launched in 1924. Since 1992, it is a subsidiary of the beer conglomerate, Lion Nathan Company (LNC). Other brands in the portfolio of LNC include Tooheys, Hahn, Emu, Swan, West End, James Esquire and James Boarg. During the first half of year 2010, net sales revenue grew 8.1% to $899 million, while volumes increased by 3.4% in a relatively flat beer market. (Lion Nathan National Foods H1 result, 2010). The company promotes an image of “responsible drinking” and reinforces this massage through various marketing communications they undertake. Brand Enhancement and Development is among the key strategic priorities which company have identified for its long term strategic direction (Reevs, 2003). XXXX is the most widely available beer throughout most of Queensland. The product line consist of two main varieties, the XXXX Gold which is the Number 2 top selling beer in Australia ((Nielsen, April 2010) and XXXX Bitter. Also available are XXXX Light Bitter, and XXXX Summer Bright Lager XXXX Beers’ market coverage strategy is a differentiated target marketing strategy. XXXX Beer takes the positioning platform of being a superior quality beer backed by a company with rich heritage of brewing history. To achieve a successful positioning for the brand, all facets of marketing mix including the promotional mix must be in harmony (Reis & Trout 1981). This is the task, which is expected to be achieved through a well-formulated and well-coordinated Integrated Marketing Communication Campaign. 2. Goals and Objectives Having gained an over view of the current situation, a company needs to develop its marketing and marketing communication strategies in relation to its goals and objectives. Such strategic marketing perspective will ensure synergy from the integrated marketing activities focusing on attaining the long-term goals and objectives of the company (Thomson & Strickland 2003) XXXX Beer’s parent company – the Lion Nathan’s vision is encapsulated in their mission statement, which is "To make our world a more sociable place". The company’s overall objective is to achieve premium position in beverages domain and XXXX brand is their flagship brand. 4. XXXX Beers’ Differentiation and Positioning Strategy and Tactics. Positioning means creating an image of the product in the minds of the buyers. All facets of marketing mix must be in harmony to achieve effective positioning which is basic to marketing success (Reis & Trout 1981). XXXX Beer depends on the positioning platforms of product differentiation and image differentiation tactics. Company has used image differentiation to its full benefit by maintaining Mr. Fourex mascot who is 86 years old todate“Experience XXXX GOLD Class on the Upper Deck” (2010). “Experience XXXX GOLD Class on the Upper Deck” (2010)., the XXXX angels and the XXXX V8 Ambassadors support its positioning strategies. The positioning strategies convey the brand’s personality. The colors and symbols used in branding are crucial and have impact on the overall positioning of the brand in the mind of the consumer. Evaluating the positioning platform of the XXXX Beer, it can be noted that they develop their brand on the rich heritage aspects of the company, which spans over a period of over 125 years. The brand XXXX uses a storyline to back its product positioning as a superior product and this story line is associated with what the XXXX brand represents. The tradition of marking beers with the letter X began with the monks in medieval times where they used the number of X’s to indicate quality – ‘XXX’ was used to indicate a high quality beer. XXXX Beer claims the position of being better than any beer, which had been brewed at the time of naming the brand, and therefore to indicate this superiority in quality another X was added to the XXX quality. XXXX's labels generally feature a depiction of the Milton Brewery alongside the Ipswich railway line of Queensland. This again reiterates its regional heritage. The XXXX Beer Bitter range carries the slogan – “Tough on Thirst” while the XXXX Gold’s slogan is “Good as Gold”. In summary if can be noted that XXXX Beer takes a positioning platform of superior quality beer with heritage rich brewing history. 5. Integrated Marketing Communication and Advantages Having considered the XXXX marketing positioning approach, the need for implementing an Integrated Marketing Communication (IMC) plan is identified to maximize the synergy between various promotional elements along with other marketing activities that communicate with the firm’s customers. IMC seeks to create cohesion between all the promotional elements utilized so that the projected image is a unified (Fitzgerald, 1988). By integrating the marketing communications, a company avoids confusion by different messages as well as duplication. It takes advantage of synergy among various promotional tools and uses it as a reiteration of different medium’s messages so that each element reinforces the other. For example, a consumer will see the message in a TVC and then see the same massage in a billboard on his drive to the retail store. Then, the customer will listen to the audio version of the same massage on the car stereo and be further reinforced when he walks in to the store and Point Of Sale Material (POSM) illustrates the same campaign theme. Then when he decides to go for a weekend of socializing with his mates to a sporting event, the event is sponsored by the same brand and banners, promotional trucks, branded sales merchandise etc. all reiterate the same marketing massage. This type of integrated communication campaigns can drive home the massage surely and with power so that top of mind recall rate is high and each element of the marketing communication process supports each other (Armstrong & Kotler 2001). Figure 1 – Integrated Marketing Approach with promotional mix elements Adopting an IMC approach provides a company with many advantages. These include creative integrity, consistency of message, unbiased selection of media, better use of all media tools, greater marketing precision, operational efficiency and cost savings (Linton & Morley 1995). IMC approach also facilitates the engagement of a single advertising agency to handle the total communication campaign, ensuring greater advertising agency accountability as the elements of communication mix is not fragmented and handled by different agencies. By using one agency to handle the overall communication campaign, the consistency as well as creative integrity in treating all mediums of communications with the same creative theme is ensured. With most mass media advertising options being significantly expensive, the IMC approach facilitates better use of media alternatives and combining the appropriate IMC tools provides better value for money. By engaging in a well planned IMC campaign, for XXXX beer, Lion Nathan Company stands to reap all these beneficial effects. 4. Proposed IMC Campaign for XXXX Beer Having identified the marketing and positioning strategies of XXXX Beer, the development of the promotional campaign will aim at attaining the marketing objectives set forth by the company. In selecting the suitable communicational elements, it is important to consider the product life cycle as well as the industry’s maturity level. As the Australian beer industry is in its maturity level and XXXX Beer which has been a pioneer product is also in its maturity stage, the choice of communicational elements should aim at brand maintenance, loyalty rewarding and sales sustenance. However, having a differentiated and segmented marketing approach based on product differentiation, the different product offerings should be placed at different stages of the product life cycle. For example while the XXXX Bitter is their original beer, the XXXX Gold is the brand leader and Gold and Light Bitter are still in its growth phases. The organization’s focus on push strategy vs. pull strategy should be considered in planning the various elements in an IMC campaign. If a pull strategy is given dominance, then advertising and consumer promotions will have dominance while a push strategy will have dominant trade promotions and personal selling. In the past the beer was marketed with a geographical focus and XXXX Beer ad campaigns appealed to the fierce regional thinking of the Queenslanders. This was highly successful approach because Queenslanders were proud of their beautiful state, and of their lifestyle, of their golden – outdoor-sporting and mate-driven -beach lifestyle. They had passionate pride in their sporting teams, in their heroes, and, of course, in their beer. The XXXX Beer ad themes of the past depicted this openly. However the beer industry and its competition are changing rapidly and the geographic focus is blurring. Victoria Bitter and other Fosters brands are taking the national market in aggressive manner and XXXX Beer has to change it marketing approach including the positioning and the ad themes to suit and appeal to the overall Australian beer drinkers than merely the Queenslanders. XXXX is currently losing its grip on younger Queenslanders.  The 18-25 year old market, which is of course a massive one, is not as passionate about their choice of XXXX Fourex as their forefathers were.  Therefore the need arise to create ad campaigns with message executions that forego the regional approach and focus on the social lifestyle for which the XXXX Beer has been know. The TVCs such as “Jacko and the Boys are back” fails to address the younger beer drinkers who cave for exiting and dynamic image from the brand communications (XXXX GOLD commercial, 2010). It is therefore proposed to incorporate the XXXX angels and the V8 racing action in to the new IMC campaigns. The IMC plan proposes the following communication channels for executing the plan. 4.1 Advertising: Television – Use of television as a means of maintaining brand recognition and reinforcing the brand superiority is recommended. It is common for consumers to associate superiority perceptions with frequently exposed brands with high media presence. The TV ad campaigns should be utilized to mainly present the newly introduced product variants such as XXXX Light bitter and XXXX Gold while providing rub off effect for the whole XXXX brand. Nielsen Media Research figures show that Foster's and Lion Nathan spent far more promoting their premium and youth-oriented beer brands in 2004 than on their mainstream labels (Cantalano, 2004). The scheduling is recommended in mid frequency level in summer season. Company is a member of the Australian Associated Brewers Inc. AAB and committed to abide by the guidelines for advertising alcohol beverages under its Alcohol Beverage Advertising Code, which is part of The ABAC Scheme for advertising regulation. No actors under 25 years of age are to be featured in beer advertising, and there are special rules about not associating beer drinking with dangerous activities. Care to choose scheduling times, which usually avoid minor’s viewing times, will be ensured. Creative theme should be integrated across all mediums and the XXXX Angels and the V8 Driving ambassadors (Meet the XXXX GOLD Ambassador Drivers, 2010). should be integrated in to the TV commercials too. With the Overall company’s vision of “making the world a more sociable place” the creative execution should take more of a life style approach where XXXX Beer becomes a crucial part of the life of amiable and sociable Australian life. And these new advertisements can show how old and the young, without a difference can enjoy XXXX beer in its variants. New advertising should tap onto the changing attitudes of both men and women in today’s more inclusive society where beer drinkers are saying they are tired of being stereotyped. All advertisements should use the closing message of XXXX and its full line up, based on umbrella branding concepts. Radio – As this is not a medium not utilized by the other competitors heavily, a catchy jingle is proposed to stay ahead of usual media clutter. This can be linked to the overall campaign of portraying a cheerful; and happy atmosphere where XXXX Beer is served. Scheduling should take in to account the channels listener-ship demographics and the product variant advertised. For example, XXXX Gold targeted at the middle aged can be advertised in 2Go FM while XXXX Summer Light Lager mainly targeting the youth can be advertised in Fresh FM. Newspaper – Newspaper is proposed to advertise special events and new product launches or support consumer promotion information. These ads should Printing redemption coupons or competition draw entry coupons can be included in the press ads. Full color, ½ page or larger format national newspapers should be used to reinforce the superiority image of the product. These ads should carry umbrella branding for the entire XXXX beer range, at sign off stage of the advertisement copy. Outdoor – This can be used as a heavy tool with its low cost and geographically strategic positioning possibilities. Locality of Milton, Queens land can be provided with high brand visibility through billboards. Main dealers and pubs can be provided with high quality illuminated signage sponsored by XXXX Beer. All graphical depictions should be consistent with the main create theme of social life style and XXXX Beer. With XXXX sponsorship involvement in the V8 racing, the track circuit and surrounding areas can be saturated with branding messages which integrate with the entire branding campaign. The outdoor advertisings should be used as a main tool promoting “responsible drinking” whereby the message “Know When to Slow Down” of XXXX , is given more exposure (Know When To Slow Down, 2010). . 4.2 Direct Marketing Inbound Tele marketing – Inbound telemarketing refers to setting up of well coordinated systems of providing marketing information to inbound inquiries. Customer information hotlines can be set up and trained staff can be positioned to provide product and company information. A spokesperson for the company can be appointed to ensure only the correct and desired information is provided. Ale House Tours is one of the key aspects which the company should be using in integrating its total communicational campaign. The Brisbane brewery already attracts some 20,000 visitors each year with its guided tours. These tours would reiterate to the public the image and message, which the company aims to provide to the consumer. The heritage, superior quality, production process, history and the product experience can all be bundled in to the “Ale House Tours” of Castlemine Pekins Brewery. 4.3 Online marketing The company’s website can be used as a highly effective tool for interactive marketing communications. This can be used to support, product launches, PR activities, create and maintain members clubs and carryout sales promotions. Direct selling can be also done via the company’s online shop. The site is also used in launching ad campaigns and to gain pre-wetting for the creative content. 4.4 Personal Selling High caliber sales team focusing on developing the retail business segment is currently a key priority and XXXX beer. This mode will continue to focus on trade customers. The sales team will undergo comprehensive orientation program and sales training to ensure the message delivered is consistent with the desired image. 4.5 Sales Promotions Sales promotion is recommended to be used as one of the key elements of the communicational mix. It can be used in many approaches as to develop sales, create awareness and induce trial and to create excitement and maintain brand recognition. Sampling operations can be carried out for new product introductions planned for the premium segment, which is currently not represented by XXXX brand. A Cool Hot Summer campaign can include beer drinking competitions in the summer season. Lucky draws can offer a year’s supply of XXXX beer for the winners. Year End Grand Celebrations can involve attractive prizes as expense paid vacations for the family. The V8 campaign can be fully integrated in to the sales promotions while the XXXX angels can liven up the sales promotions with the support of the innovative concepts of mobile pub houses (Experience XXXX GOLD Class…, 2010). 4.6 Public Relations & Publicity This can be used as a very strong tool in the promotional mix. Castlemine Pekins is known as the brewery producing the XXXX brand beer but the brand can also benefit from being affiliated with its parent Company – the Lion Nathan Conglomerate. Publicity should be given for XXXX Beer as well as its parent company. All new product launches, new sales promotion launches and winning of draws should be used as publicity opportunities. XXXX brands Sponsorships in sports and arts is currently very high and includes V8 racing, Polocrosse World cup, The Arts, Hamilton Island Race Week, Queensland Surf Life Saving etc. Effort should be taken in to maximize brand exposure at these events. Sports personalities in the sponsored teams as the Queensland Bulls, The Queensland Reds, The North Queensland Cowboys and Brisbane Broncos should be used at spokes person for the product and their product endorsements should be used in executing the overall campaigns create theme of a social life. Company is currently involved in many community service projects and also dedicated to environment protection and best manufacturing practices. Efforts such as Duendin fund to preserve natural water resources in Duindin is an example of such effort which has very little awareness (Donate for Dunedin, 2010). Another is the company’s effort in recycling packaging material. Such activities should receive regular public exposure to establish the corporate responsibility aspects of XXXX beer’s brand and its company.. 5. Budget Proposal Table 1– Preliminary Communication Budget for year 2010 IMC Tool Details Budget Allocation $A Allocation % TV Advertising Production & Scheduling of 30 sec. Advert with new creative theme. Prime time and non prime time programs of selected channels (Approximate cost per prime time spot $ 200,000, non prime time - $ 50,000 / Production of TVC - $ 400,000) 3.5 Million 31% Radio Advertising Spot cost approximately $ 100 0.25 million 2% Press & Magazines ½ page ads in magazines as cosmopolitan and outback at the rate of A$ 2000 per insertion. 0.5 million 4% Outdoor – Billboards & Signage Outdoor billboards, bus and train branding, outdoor signage, pub signs with logos 1 million 9% Sales Promotions Three sales promotion campaigns including a yearend grand draw. 2 seasonal sampling drives. Branded item giveaways as caps, beer mugs, T shirts and coasters 1.5 million 13% Personal Selling Development and training of sales team. Sales force competition with prizes. 0.5 million 4% Public Relations & Publicity Social service projects, press conferences, tours for the ale house and other events 1.25 million 11% Sponsorships Sponsorship of sports teams and sports events. 3.0 million 26% Total Budget 11.5 million 100% 6. Evaluation and Control Systems An essential process of the communication process lies in the evaluation and control. The communications can be evaluated on both communicational effect as well as sales effect. While the impact of marketing communications on sales is recognized, means of measuring the degree of correlation is yet unknown. Following evaluation and control measures are proposed in gauging the effectiveness of the proposed marketing communication campaign. These evaluations should be utilized not as postmortem studies by on real-time basis to back up and modifications which might be needed in response to changes in scenarios such as a counter ad campaign by competitors. Effectiveness of TV ads can be gauged by the Top Of Mind Recall rates of ads, the message recall rate, the reach of the audience, the frequency of exposures etc. It can also be gauged by heightened awareness levels of new products or launching of sales promotion campaigns etc. Radio, press and magazine ad evaluations are based on readership estimates and the estimated cost per contact. The enhanced image, which is the expected output, can be measured through before and after exposure surveys. Direct marketing –if inbound, will evaluate the number of callers assisted and provided with information while Online Marketing effectiveness can be gauged by number of visitors to the website, the purchases at the online shop and number of registrations online in the membership clubs. Evaluating the effectiveness of sales promotions are much easier than the other elements as the number of participants can be tracked. Personal selling too can be evaluated accurately as sales quantities and number of orders can be observed. Public relations & Publicity is evaluated on the aspects of output, outgrowths and outcomes. It is the final measure of outcomes which aims at a favorable image of the company in the consumers mind, which is facilitates by the output and outgrowths of publicity which refers to the effectiveness of communicating and effectiveness of comprehension of the intended message (Harris 1998).Control systems should include appointment of a single spokesperson for the company who is responsible for drafting communiqués with internal consensus and providing to external sources. Subscribing to media ratings to monitor the program and channel ratings and having procedures to track number of insertions in press on ads as well as publicity articles is necessary. Requesting the agency to provide broadcast records for the scheduled ads in TV and radio is to ensure control of actual airing . For the purpose of online marketing periodical content updates and monitoring of feedback is necessary. IMC unit of the company should not only focus on internal activities but also on competitor activities, which may render costly campaigns useless through counter ad campaigns. 7. Conclusion In the fiercely competitive Australian beer industry, which is in its mature stage, the market share gaining is a hard task. Sustaining the existing market shares too is a challenging task, needing product and marketing innovation. With different market segments having different preferences, the need for deploying effective communicational mixes targeting different segments is crucial for success. With a vast variety of media options and increased communicational modes, organizations must endeavor to develop integrated communicational campaigns, which will deliver the desired messages to its target audience, eliciting desired responses. The rising costs of advertising essentially mean that costly mistakes are unaffordable and when applied in to an Integrated Communication Campaign, the gravity of mistake can be huge if recalls are to be made. References: “Australian beer industry hearty and 'ale” Asia Times [Online] 2001. Retrieved on 1.10.2010 from http://www.atimes.com/oceania/CF15Ah01.html Armstrong, G. & Kotler, P. 2000, Marketing: An Introduction, 5th ed, Person Education Inc, Singapore. “Beer and Malt Manufacturing in Australia”. (2010). Australian Industry Report. Retrieved on 5.10.2010 from http://www.ibisworld.com.au/industry/default.aspx?indid=116l Blair, S. (2010). Trendy new brews revive a flat beer market. Retrieved from http://www.theaustralian.com.au/business/trendy-new-brews-revive-a-flat-beer- market/story-e6frg8zx-1225837968159 Cantalano, C. 2004 “Brewers spend big to woo under-30s,” Fair Fax Digital. Retrieved from 5.10.10 from http://www.theage.com.au/articles/2004/03/16/1079199223444.html “Donate for Dunedin.” (2010). Retrieved on 7.10.2010 from http://lion-nathan.com.au/media-centre/2010/03/15/donate-for-dunedin/ “Experience XXXX GOLD Class on the Upper Deck” (2010). Retrieved from http://www.xxxxgoldv8supercars.com.au/gold-retreat/ Fitzgerald, J. 1988, “Integrated Communications,” Advertising Age, February, p.18. Harris, T. L. 1998, Value Added Public Relations: Secret Weapon of Integrated Marketing, NTC Business Books, Illinois. “In the Pits with the XXXX GOLD V8 Supercars Ambassador Drivers.” (2010) Retrieved from http://www.xxxxgoldv8supercars.com.au/xxxx-gold-drivers/ “Know When To Slow Down.” (2010). XXXX Web. Retrieved from http://www.xxxxgoldv8supercars.com.au/when-to-slow-down/ “Lion Nathan National Foods H1 result.” (2010). Flexnews. Retrieved from http://www.flex- news-food.com/console/PageViewer.aspx?page=31685 Linton, I. & Morley, K. 1995, Integrated Marketing Communications, Butterworth-Heinemann Ltd, Oxford. Reevs. A. M., 2003, “ Australian Beer Market Overview- Lion Nathan Australia”, Consumer Products & Retail Conference, Warbug. Rise, A. & Trout, J. 1986, Positioning: The battle for your mind, McGraw-Hill Book Co., Thomson, A. A. Jr. & Strickland, A. J. 2003, Strategic Management Concepts and Cases, 13th ed, Tata McGraw-Hill Publishing Company Ltd., New Delhi. XXXX GOLD commercial, Jacko and the boys are back! (2010) http://www.pakistan.tv/videos-xxxx-gold-[Vnmd-kslKxg].cfm XXXX Ale House & Brewery Tours. (2010) XXXX Web site. Retrieved from http://www.xxxxalehouse.com.au/?utm_source=xxxxbrandhub&utm_medium=website&utm_campaign=global_header&t=77f5c7316802cf4329dcfe95e4f44d024caf1c007d625 Read More